Valence Technology Reports Second Quarter Fiscal 2012 Financial Results
November 08 2011 - 04:00PM
Valence Technology, Inc. (Nasdaq:VLNC), a leading U.S.-based global
manufacturer of advanced energy storage solutions for commercial
applications today reported financial results for its fiscal 2012
second quarter and six-months ended September 30, 2011.
Executive Commentary
"During the second quarter we continued to see strong uptake of
Valence's solutions with key commercial customers and made progress
toward our strategy of transitioning to a more diversified mix of
global customers. We now have a more balanced customer base with no
single customer exceeding 21% of revenue in the current quarter,
versus a single customer accounting for over 40% of revenue during
the previous year. We believe that an expanding, diverse customer
base will drive long-term profitability for Valence," said Robert
L. Kanode, president and chief executive officer of Valence
Technology.
"In addition, we are growing our customer base without any U.S.
Department of Energy grants or loans; a fact that is proving to be
a key differentiator in customer engagements both in the United
States and in Europe," concluded Kanode.
Fiscal 2012 Second Quarter compared to FY2011 Second
Quarter:
Financial results:
- Revenue was $8.5 million compared to $12.7 million in the
second quarter of fiscal 2011.
- The Company's results compare to the year ago quarter as
follows:
- Net loss available to common shareholders was $4.6 million, or
$0.03 per share, compared to a loss of $3.6 million, or $0.03 per
share.
- Operating loss was $3.8 million compared to a loss of $2.7
million.
- Operating expenses were $5.5 million compared to $5.5 million.
- Gross margin was 21% compared to 22%.
Recent business highlights:
- Placement of Valence powered transit bus at London's Heathrow
Airport, the first all-electric bus in operation at a UK airport.
- A legal victory on a patent infringement lawsuit in Canada,
which validates Valence's IP and will result in payments to Valence
that will include legal costs and damages.
- Favorable first phase reviews of Valence powered vehicles
during a large electric vehicle assessment program being conducted
by Ford-Werke GmbH in Germany.
- Preparing to begin delivery in Fiscal Q3 against a
previously announced $7.2 million order from EVI for 100 UPS
delivery trucks.
- A recent extension of a supply agreement with Rubbermaid
Medical Solutions, one of the leading providers of medication carts
and mobile computing stations for healthcare facilities.
First Half Fiscal 2012 compared to First Half Fiscal
2011:
- Revenue increased 24% to $22.5 million, compared to $18.2
million.
- A diverse and more balanced customer base with no single
customer exceeding 23% of revenue versus two customers collectively
exceeding 70%.
- Gross margin consistent at 20%.
- Operating loss narrowed to $6.0 million, compared to a loss of
$6.3 million.
- Net loss available to common shareholders decreased to $7.7
million, or $0.05 per share, compared to a loss of $8.3 million, or
$0.06 per share.
Business Outlook
- Valence expects fiscal 2012 third quarter revenue to be in the
range of $8.5 million to $9 million.
- Valence expects fiscal 2012 fourth quarter revenue to be in the
range of $15 million to $18 million, an increase over fourth
quarter revenue of $13.9 million last year.
- For the full fiscal year 2012, Valence expects revenue to be in
the range of $46 million to $49.5 million, up from $45.9 million
for fiscal 2011.
- Additionally, for the full fiscal year 2012, Valence expects no
single customer to account for more than 20% of revenue.
Conference Call and Webcast
Valence Technology will conduct a conference call today at 3:30
p.m. CT (4:30 p.m. ET) to discuss its second quarter fiscal year
2012 financial results. Interested parties may participate in
the call by dialing (877) 375-1350 (international callers dial
(253) 237-1153). No passcode is required. The conference call will
also be webcast live and can be accessed by visiting Valence's web
site at www.valence.com and clicking on the following links:
Investor Relations - Events & Presentations. To access the
webcast, please go to this web site approximately fifteen minutes
prior to the start of the call to register, download, and install
any necessary audio software. A replay of the webcast will be
available on the company's Web site at www.valence.com. A
telephonic replay will also be available from 6:30 p.m. CT on
November 8, 2011, through 6:30 p.m. CT on November 30, 2011. To
access the replay, please dial (855) 859-2056 and enter conference
passcode 16349026. Callers outside the United States and Canada can
access the replay by dialing (404) 537-3406 and entering the
conference passcode mentioned above.
About Valence Technology, Inc.
Valence Technology is a global leader in the development and
manufacture of safe, long-life lithium iron magnesium phosphate
advanced energy storage solutions and integrated command and
control logic. Headquartered in Austin, Texas, Valence enables and
powers some of the world's most innovative and environmentally
friendly applications, ranging from commercial electric vehicles to
industrial and marine equipment. Valence Technology today offers a
proven technology and manufacturing infrastructure that delivers
ISO-certified products and processes that are protected by an
extensive global patent portfolio. In addition to the corporate
headquarters in Texas, Valence Technology has its Research &
Development Center in Nevada, its Europe/Asia Pacific Sales office
in Northern Ireland, manufacturing facilities in China, and global
fulfillment centers in North America and Europe. Valence Technology
is traded on the NASDAQ Capital Market under the ticker symbol
"VLNC." For more information, visit www.valence.com.
The Valence Technology, Inc. logo is available at
http://www.globenewswire.com/newsroom/prs/?pkgid=10210
Safe Harbor Statement
This press release contains forward-looking statements within
the meaning of the Private Securities Litigation Reform Act of
1995, including, among other things, our statements regarding the
strong uptake of our solutions, transitioning to a more diversified
mix of customers, driving long term profitability, growing our
customer base, favorable first phase reviews, beginning delivery in
fiscal Q3 on the EVI order, our third and fourth quarter revenue
guidance, our fiscal year 2012 revenue guidance and our expectation
that no single customer will be more than 20% of revenue in fiscal
2012. Our actual results could vary substantially from these
forward-looking statements as a result of a variety of factors
including: the impact of our limited financial resources on our
ability to execute on our business plan, commercially exploit our
technology, respond to unanticipated developments, and compete
effectively in the marketplace; the possibility that our current
equity financing arrangements may not be sufficient to meet our
cash requirements and the need to raise additional debt or equity
financing to continue as a going concern; our uninterrupted history
of quarterly losses and our ability to ever achieve profitability;
the overall demand for batteries to power electric vehicles, and
the demand for our lithium-ion batteries and lithium phosphate
battery technology; our ability to service our debt, which is
substantial in relationship to our assets and equity values; our
ability to collect our outstanding accounts receivable; the pledge
of all of our assets as security for our existing indebtedness; the
rate of customer acceptance and sales of our current and future
products; our ability to form effective arrangements with OEMs to
commercialize our products; the level and pace of expansion of our
manufacturing capabilities, including our ability to scale our
manufacturing and quality processes at a level necessary to support
potential demand; product or quality defects; the level of direct
costs and our ability to grow revenues to a level necessary to
achieve profitable operating margins to achieve break-even cash
flow; our dependence on sole or a limited number of suppliers for
key raw materials and components, and the ability of our vendors to
provide conforming materials for our products on a timely basis;
the level of our selling, general, and administrative costs; any
impairment in the carrying value of our intangible or other assets;
our ability to achieve our intended strategic and operating goals;
international business risks, particularly the many risks inherent
in doing business in China; our ability to attract and retain key
personnel; the failure to expand our customer base; the effects of
competition; and the outcome of any current or future litigation
regarding intellectual property and general economic conditions.
These and other risk factors that could affect our actual results
are discussed in our periodic reports filed with the Securities and
Exchange Commission, including our Annual Report on Form 10-K for
the fiscal year ended March 31 and Quarterly Reports on Form 10-Q
and other documents filed with the Securities Exchange Commission.
The reader is directed to these statements for a further discussion
of important factors that could cause our actual results to differ
materially from those in our forward-looking statements. We
disclaim any intent or obligation to update these forward-looking
statements.
{financial tables to
follow}
VALENCE TECHNOLOGY,
INC. AND SUBSIDIARIES |
CONSOLIDATED BALANCE
SHEETS |
(in
thousands) |
|
|
|
|
September 30, 2011 |
March 31, 2011 |
ASSETS |
|
|
Cash |
$ 4,169 |
$ 2,915 |
Accounts Receivable |
8,765 |
13,615 |
Inventory |
21,364 |
12,491 |
Prepaids and Other Current Assets |
2,593 |
2,661 |
Total Current Assets |
36,891 |
31,682 |
|
|
|
Fixed Assets and Other Long Term Assets |
4,348 |
4,335 |
|
|
|
Total Assets |
$ 41,239 |
$ 36,017 |
|
|
|
LIABILITIES, PREFERRED STOCK AND
STOCKHOLDERS' DEFICIT |
|
|
Accounts Payable |
$ 12,937 |
$ 9,150 |
Accrued Expenses |
4,827 |
6,063 |
Short Term Debt |
4,875 |
10,686 |
Total Current Liabilities |
22,639 |
25,899 |
|
|
|
Long Term Debt and Other Liabilities |
66,835 |
65,342 |
Total Liabilities |
89,474 |
91,241 |
|
|
|
Redeemable Convertible Preferred Stock |
8,610 |
8,610 |
|
|
|
Total Stockholders' Deficit |
(56,845) |
(63,834) |
|
|
|
Total Liabilities, Preferred Stock and
Stockholders' Deficit |
$ 41,239 |
$ 36,017 |
|
VALENCE TECHNOLOGY,
INC. AND SUBSIDIARIES |
CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS |
(in thousands,
except per share amounts) |
|
|
|
|
|
|
Three Months Ended |
Six Months Ended |
|
September 30, |
September 30, |
|
|
|
|
|
|
2011 |
2010 |
2011 |
2010 |
|
|
|
|
|
|
|
|
|
|
Total Revenues |
$ 8,463 |
$ 12,651 |
$ 22,548 |
$ 18,223 |
|
|
|
|
|
Cost of Sales |
6,705 |
9,868 |
17,941 |
14,515 |
|
|
|
|
|
Gross Margin |
1,758 |
2,783 |
4,607 |
3,708 |
|
|
|
|
|
Operating Expenses |
5,520 |
5,514 |
10,618 |
9,968 |
|
|
|
|
|
Operating Loss |
(3,762) |
(2,731) |
(6,011) |
(6,260) |
|
|
|
|
|
Net Loss Available to Common
Stockholders |
$ (4,606) |
$ (3,624) |
$ (7,741) |
$ (8,278) |
|
|
|
|
|
|
|
|
|
|
Net Loss Per Share Available to Common
Stockholders |
$ (0.03) |
$ (0.03) |
$ (0.05) |
$ (0.06) |
|
|
|
|
|
Shares Used in Computing Net Loss Per Share
Available to Common Stockholders, Basic and Diluted |
166,970 |
135,719 |
161,686 |
134,073 |
CONTACT: IR Contact:
Bob Gray
Valence Technology, Inc.
512.527.2921
investor@valence.com
PR Contact:
Jeff Fox
The Blueshirt Group
415.828.8298
jeff@blueshirtgroup.com
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